Estate Planning and Administration for Everyone: A Beginner's Guide to Securing Your Legacy

Estate Planning and Administration for Everyone: A Beginner's Guide to Securing Your Legacy

Natalie Cantave
October 12, 2023

When we think about financial literacy, we typically associate it with budgeting, having robust emergency savings, and minimizing credit card debt. However, we need to look beyond building your savings and preparing your finances for the worst — we also need to think about finances as it relates to death, grief and mortality. We need to plan for legal and financial matters to support dependents and ensure that your assets are protected when you’re no longer here.

Yes, this topic is overwhelming because it’s not easy to think about your mortality or end-of-life planning, but it's an important conversation to have. Additionally, Finance Literacy Month is about democratizing access to information so we can be more empowered to make decisions that impact us as individuals and our loved ones.

We are kicking off our 4-part blog series throughout the month of April, tackling important topics that are tied to end-of-life planning, and our first topic will be focused on estates.

Here are some frequently asked questions around estates, along with steps to help you start securing your assets and possessions:

What is an estate?

  • Nearly everyone has an estate - regardless of size! Your estate consists of everything you own: your car, home, other real estate or property, checking and savings accounts, investments, life insurance, furniture, personal possessions.

What is estate planning? Why is it important?

  • Estate planning involves making plans in advance about your assets and possessions and where they will go after you’re no longer here. Estate planning is important because it’s for everyone! It’s also not a one-time event. It’s an ongoing process — you should review and update your plans as circumstances change.
  • Estate planning is important because it can be costly and confusing when you don’t take the steps to plan efficiently. If planned well, you will reduce the burden on your loved ones after you’re gone — otherwise they will be left to pick up the pieces and navigate handling your estate in confusion and worry.

How do I know if my estate plan is sufficient?

  • If you have an estate plan and will in place, you’re already ahead of 50% of the population! An estate that is well planned is one that is administered efficiently! We’ll share more details about you can work with an experienced professional.

What steps are involved in estate planning?

  • Step 1: Take inventory of all your assets
  • Step 2: Document arrangements for disability income insurance to replace your income if you can’t work due to illness or injury
  • Step 3: Ensure you have life insurance to provide for your family
  • Step 4: Talk about what your loved ones will need when you’re gone
  • Step 5: Start identifying important documents that are needed. (We'll dive into more detail about this in a future blog post)
  • Step 6: Designating an executor for your estate

An executor is the person who will carry out your wishes regarding your estate, which are documented in your will or trust. An executor can be someone of your choosing. If not, it will be chosen by a court. One of the major responsibilities of an executor involves going through a legal proceeding called probate. More to come on that.

  • Step 7: Decide who will be your beneficiary (or beneficiaries)
  • Step 8: Understand your state’s estate tax laws
  • Step 9: Continue reviewing and updating your plans

What is probate? How long does probate take?

  • Probate is the legal process your estate goes through after you’re no longer here. During this legal proceeding, a court will first authenticate your will (or trust) and approve the executor that is named so they can begin to distribute your estate to beneficiaries. The average time to complete the probate process could be six to nine months if everything is seamless.
  • However, if there are no documents or if challenges arise, the process becomes more complicated. During complicated processes, probate can take up to several years. And if there isn’t an executor named, the courts ultimately decide what happens to your estate - even if they are against your wishes.

Important considerations: Hiring a professional to support you

We know that taking the first steps towards securing your legacy can feel overwhelming - which is why we recommend you do not undertake this alone! Here are a few reasons why we recommend you work with an attorney or experienced fiduciary:

  1. An attorney can be named as the executor of your estate to avoid conflict within your family
  2. An attorney has the legal knowledge and expertise to navigate legal jargon
  3. An attorney can help navigate difficult conversations and resolve conflict with your beneficiaries.
  4. An attorney will ensure that your legacy will be placed in the right hands
  5. An attorney will ensure everything is seamless to avoid complications during probate
  6. Hiring an attorney to help with estate planning will be more cost-effective now, compared to leaving the financial burden and stress on your dependents and beneficiaries

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